Welcome to AMS Blog

Wednesday, January 18, 2012

1% of U.S. Residents Accounting for 20% of Total Health Spending
One percent of U.S. residents accounted for more than 20% of overall health care spending in 2009, according to a report by the Agency for Healthcare Research and Quality, HealthLeaders Media reports (Clark, HealthLeaders Media, 1/12).

Further, just 5% of U.S. residents accounted for 50% of health spending, the report found (Kennedy, USA Today, 1/11).

The findings support previous analyses finding that a relatively small number of sick individuals have a large effect on national health care spending, according to National Journal (Sanger-Katz, National Journal, 1/11). However, the study noted that there has been a "decrease in this concentration at the upper tail of the expenditure distribution." For example, in 1996, the top 1% accounted for 28% of total health care spending.

Additional Findings

The report also found that:

■For the top 1% of spenders, average annual health spending was about $90,061 (HealthLeaders Media, 1/12);
■The top 5% of spenders averaged $36,000 annually in health care costs (USA Today, 1/11);
■The bottom 50% of health care spenders accounted for just 2.9% of spending in 2009 and 3.1% in 2008 (HealthLeaders Media, 1/12); and
■About 20% of U.S. residents remained in the top 1% of health care spenders for at least two consecutive years.
Individuals who remained in the top 1% for at least two consecutive years tended to be white women in poor health, elderly and those enrolled in public health insurance plans (USA Today, 1/11).

Highest, Lowest Spenders on Health Care

The report also found that high-income individuals and those with health plans tended to be the highest spenders (National Journal, 1/11). The report noted the following characteristics of the health care spenders in the top 10% in 2009:

■80% were white;
■60% were women (USA Today, 1/11);
■42.9% were ages 65 or older (HealthLeaders Media, 1/12);
■3% were between ages 18 and 29; and
■2% were Asian.

In addition, Hispanics tended to spend less on health care, with 25% of Hispanics among the bottom half of health care spending and just 7% in the top 10% of spenders (USA Today, 1/11).